Growing the economy doesn’t mean more FTs, nor more start-ups, nor more financing of SMEs (owners use money to buy property, flashy cars and donate to WP LOL), but an innovation ecosytem.

This comment by someone analysing the stagnation in the West applies here too

What we need if we are to avoid the much-feared “secular stagnation” is not many small startups—or an obsession with financing “SMEs”–but an innovation ecosystem in which these new firms are made relevant through a dynamic interaction of public and private investments. This requires a public sector able and willing to spend large sums on education, research and those emerging areas that the private sector keeps out of (because of high capital intensity and high technological/market risk); large firms which reinvest their profits not in share-buybacks but in human capital and R&D; a financial system that lends to the real economy and not mainly to itself; tax policy that rewards long run investments over short run capital gains; immigration policy that attracts the best and the brightest from around the world; and rigorous competition policy that challenges lazy incumbents rather than letting them get away with high prices and parasitic subsidies.

Given the importance the PAP places on growth (a growing economy translates into voters: a Hard Truth that went wrong when the PAP forgot that growth must benefit voters), one can only hope it focus on creating an innovative ecosystem, rather than talk about it, as it has done for yrs on end.

PM should look this up given his recent call for more R&D spending by the private sector. One lesson: home grown cos needed, not MNCs. UK is nowhere to be seen because like S’pore most of its manufacturing is done by MNCs HQed abroad.

The recipes of other cities for creating the next Silicon Valley usually leave out a few main ingredients. Richard Florida, who wrote “The Rise of the Creative Class” and studies why certain cities foster creativity, cites three crucial factors: talented people and a high quality of life that keeps them around, technological expertise, and an open-mindedness about new ways of doing things, which often comes from a strong counterculture: extract from NYT on Boulder Colorado,.

We could do the first two like we do “instant” trees” or citizens: but a strong counterculture? Not that long ago, the government had problems with people with long hair. Today, it (and to be fair, society) has problems with drugs (long term imprisonment for users and sometimes death), alternative life-styles (read buggery and free love), and liberal democracy.

BTW, an ex-MIcrosoft strategist and now VC, earlier this week, was saying (according to Today) that the Silicon Valley model was not for S’pore. He advocated something that sounded like that could have come out of USSR’s infamous five- year plans.

The way forward, especially for relatively small countries with financial transparency and access to “good capital”, is to pursue innovation mega-projects, he said.

In Singapore’s context, an official body could serve as “prime contractor” mapping the vision, plans, standards and project management for such a project.

It could then hire “sub-contractors” to take care of aspects like inventions, and products and services.

How would this approach differ from previous forays like the Economic Development Board’s efforts to create an innovation hub here?

The key difference is in not allowing companies to come in and integrate “at the company’s discretion”, said Mr Jung.

One of the last innovation mega- projects that Singapore tried to drive, and where “a lot of external people” were brought in, was the broadband information superhighway project. That was in the ’90s, when Mr Jung was with Microsoft.

He said the tech giant had sent a group to look at participating in the project.

“But there wasn’t a prime contractor. There was no one really driving that vision,” he said.

Going down the innovation mega -project path – which could range from healthcare to education to alternative energy – would be “a lower risk way of bringing lots of technology in, and probably seeing it actually succeed,” he said.

“So I’d like to see Singapore really try that. I think it’ll be interesting.”

Edward Jung claimed that from his interaction with officials in local institutions, … said there seems to have been a rethink about pursuing this model [Silicon Valley].

Seriously, given the S’pore’s govt penchant for building state-of-the-art infrastructure, could this be a reason why we have problems in the “innovation space”.

That lousy infrastructure = innovation.

The Economist’s Babbage blogged, “It’s well established that America, on a number of different measures of internet speed, availability and penetration, tends to rank about 15th. Yet YouTube, Twitter and the iTunes store are all American innovations, all from a time when America was already falling behind on speed and access. Which leads me to a question: is it possible that the limitations of America’s internet infrastructure actually spur innovation? The delivery of Flash-encoded video — as on YouTube — is a cleverly efficient use of bandwidth. If America could pipe 100 HD channels into every home, would there have been a YouTube?”